by Calculated Risk on 4/11/2008 09:33:00 AM

From the WSJ: Import Prices Show Pervasive Jump, Even When Oil Costs Are Excluded

Import prices surged in March, lifted by not only oil but also the biggest jump in nonpetroleum costs on record, a worrisome sign for inflation.

Overall import prices rose 2.8% last month, after increasing an unrevised 0.2% in February, the Labor Department said Friday. ...

During the 12 months since March 2007, prices increased 15%. ...

Excluding petroleum, all other import prices rose 1.1% in March, after increasing 0.7% in February. Prices excluding petroleum increased 5.4% in the 12 months since March 2007, nearly double the 2.8% climb between March 2006 and March 2007.

Rising import prices have a somewhat small impact on U.S. inflation, because total imports (about $2.3 trillion in 2007) are relatively small compared to GDP ($13.8 trillion in 2007) - or about 17% of GDP. But the 5.4% increase in import prices does add - as a rough estimate - about 1% to U.S. inflation.

Also, increases in the trade deficit, associated with rising prices (as opposed to more imported goods and services), is unwelcome news.